Long Position on LAC @ $36.85 on 3/31/2022 (Momentum)

Lithium Americas Corp. (LAC) operates as a resource company in the United States and Argentina. 

The company explores for lithium deposits. It owns interests in the Cauchari-Olaroz project located in Jujuy province of Argentina; Thacker Pass project located in north-western Nevada; and Pastos Grandes project located in the Salta province of Argentina. 

Shares jumped yesterday after Bloomberg reported that the U.S. president may invoke the Defense Production Act (DPA) of 1950 "to encourage domestic production of critical minerals for electric-vehicle and other types of batteries" -- and in particular, the production of lithium -- as early as today.  

Bloomberg notes that the DPA contains provisions permitting the government to utilize a $750 million "Title III Fund" to subsidize measures to increase domestic production of strategically important metals and minerals such as lithium (and nickel, graphite, cobalt, and manganese besides). Among other activities, the monies could be spent to "fund production at current operations, productivity and safety upgrades, and feasibility studies."

Yesterday's price move caused shares to jump out of their bullish "cup and handle." We expect the momentum to continue. Buyer beware that this company does not make any money. The company reported a 4th Quarter December 2021 loss of $0.10 per share.

Entry Point: $36.85

Stop Loss: $34.00

Trading Range: $11.84 to $41.56

Target Price: $41.00

Position closed on 4/11/2022 at price of $33.50 with a -9.09% loss in 11 days.

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